In an attempt to address the city’s growing shortage of affordable housing, some members of the Seattle City Council have become students of the law of supply and demand.

Build more units, they say, echoing the words of real estate developers, and prices will become affordable— to people who earn $43,600 to $65,400 a year, or 80 percent to 120 percent of the area’s median income.

It’s a range of so-called workforce renters and buyers. Incumbents are worried about them in an election year where skyrocketing high-rises and rents are forcing lower-income workers out of the city and driving neighborhood activists nuts with box-like developments that they say have no character.

In the past two years alone, according to data presented to incumbent candidates, City Councilmembers Sally Clark, David Della, Jean Godden, and Tom Rasmussen at a July 20 housing forum with developers, rents in the Seattle area have jumped 14 percent – and are expected to do so again over the next two years, which will increase the monthly rent of a one-bedroom in a brand new building from roughly $1,500 today to $1,700 in 2009.

A candidates’ forum planned for Aug. 2 on growth and development will look at what, if anything, Seattle can do to keep the city growing and affordable. But other than tinkering with a tax break for developers who build median-priced affordable housing units, the incumbents aren’t endorsing any specific tactics or developer incentives. City Councilmember Jean Godden is facing sharp criticism that she’s a tool of developers.

At a July 17 meeting where the 43rd District Democrats voted on their endorsements for the Aug. 21 primary, a flier co-authored by John Fox of the Seattle Displacement Coalition stated that Godden has “consistently voted against the interests of neighborhoods, low-income and working people while routinely catering to the likes of Paul Allen, downtown, and the corporate establishment.”

Godden says Fox has it wrong.

“I’ll have to recall which claims I’ve turned down,” says Godden, who is campaigning for a second term. “It seems to me when [developers] wanted to put a hotel into the Alaska Building, I said no.”

All the same, the statement helped sink her with Democrats in the University District, resulting in a no endorsement vote – a shutout that Green Party candidate Joe Szwaja says will bolster his chances against Godden. According to Seattle Ethics and Elections reports, Godden had raised $167,620 as of July 16, in part from real-estate interests including Al Clise, Frank Stagen, John Teutsch, Greg Smith, Jon Runstad and Paul Allen’s Vulcan Inc. Szwaja had raised $30,000.

On July 10, Democrats in Ballard’s 36th District also gave Godden a no endorsement after several stood and gave speeches for Szwaja, who said at the meeting that he wants to see more city money spent on people not developers.

At last week’s City Council housing forum, however, seven developers said they make little profit on median-priced units and that the tax break the city provides for including more affordable units in a project – the Multifamily Tax Exemption, or MFTE – is seldom of financial benefit to them in high-density, high-cost areas such as Capitol Hill where the tax break is allowed.

Godden and City Councilmember David Della -- the only other incumbent with a serious challenger this year -- both say they’re interested in reworking or expanding the tax break so more developers will use it. Both also broadly endorse the concept of inclusionary zoning, in which the city grants developers more height in exchange for including some affordable units, or incentive zoning, in which developers get extra height in exchange for a fee that goes toward affordable housing.

Last year, the council passed a downtown incentive in which developers who pay about $18 a square foot for affordable housing are allowed to build higher than 190 feet. With upzoning planned south of downtown and in the South Lake Union area, Godden and Della both said they would consider a similar fee.

“We tend to give away our zoning,” Godden says, so “I think that was an important thing to do.”

But both were shy on the topic of going back to the Legislature to get the authority to halt or cap the current rush of apartments being converted to condominiums – a crisis that led City Councilmember Tom Rasmussen, chair of the council’s Housing and Human Services Committee, to champion a condo conversion bill that failed in this year’s Legislature.

That hesitation, says challenger Tim Burgess, is one reason he’s running against Della, who he says has shown poor leadership on the council. Burgess, who spent 21 years as a marketing consultant for nonprofits, says he wants to increase developer incentives, but that, in the short term, the city has to rein in condo conversions.

“I agree with Tom,” Burgess says. “I think we are in such an emergency that we need to take at least some temporary measures like a limit on conversions until the supply of housing catches up.”